Bill targets federal money for jobless Mainers

Posted April 05, 2009, at 8:35 p.m.
Last modified Nov. 21, 2010, at 7:09 p.m.

AUGUSTA, Maine — Some Mainers this week are expected to be the first to exhaust all unemployment benefits available to them, and to help them Gov. John Baldacci is submitting emergency legislation to allow the state to tap into a new federal extended unemployment benefit program that is part of the economic recovery act.

“We have to move and we have to move fast,” Baldacci said. “We have about 9,900 people that will be exhausting all of their benefits this year.”

More than 26,000 Mainers are receiving regular unemployment benefits, and about 7,000 are receiving emergency benefits.

The governor said the recession has led to Mainers receiving unemployment benefits for longer periods of time. Some have exhausted not only the 26 weeks of regular benefits through the state system but also the emergency benefits Congress passed last year. The maximum is 59 weeks of benefits.

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“I have been working with legislative leaders on this” new federal program, Baldacci said. “I am proposing we have a $500,000 to $600,000 fund set up to pay the unemployment benefits of any state, local government and tribal government workers that are laid off.”

Federal law does not allow use of the extended benefit pro-gram for federal government workers.

The new federal extended benefit program would trigger extended benefits for unemployed workers that differ from current state law. Because of the different mechanism, the new program could bring in between $27 million and $38 million for up to 13 weeks of additional benefits in return for spending about a half-million dollars, the governor indicated.

Money for the proposal would come from general fund dollars that have been made available because of the increased Medicaid matching rate that is also part of the recovery act.

Labor Commissioner Laura Fortman said Maine’s current extended benefits law would “almost certainly” be triggered sometime this year as unemployment continues to increase.

“Unlike some other states, it’s not that our law does not allow the federal extended benefits; it’s because the trigger we have in law is different,” she said, “so we need to change the trigger mechanism at least for the period of the federal program.”

The governor said the new federal program is a good deal because “it also avoids having the existing state program kick in, which Maine employers would have had to pay half the cost.”

Maine AFL-CIO President Ed Gorham said it is a “no-brainer” for the state to change its trigger to bring in the additional federal money. He said it is a win for workers and for employers because if the state waits to have the current trigger take effect, the feds will only pay half of the cost of the benefits.

“This money will go directly into communities to help people pay their bills and buy groceries,” he said. “This is what the stimulus package is all about.”

Sen. Peter Mills, R-Cornville, a member of the Legislature’s Labor Committee, agreed. He said there is broad agreement the recession will not be ending quickly, and changing the definition to bring in millions of additional federal dollars during the recession will boost the state’s efforts to recover.

“There will be a real boon to many unemployed people in Maine and to their employers, who otherwise would have to pay for part of these benefits through a tax increase on wages,” he said.

In addition, the state could get another $28.2 million in federal funds to bolster the unemployment trust fund if it changed provisions dealing with benefits for a person who quit his job because of domestic violence against an immediate family member or quit for illness or to follow a spouse to a new job location.

“If all of these changes had been in place in 2008, we estimate the total cost to the Unemployment Trust Fund in increased benefits paid would have been approximately $146,000,” Fortman stated in a memo. “The cost would be less during periods of lower unemployment when benefit durations are shorter.”

Legislative leaders have discussed the governor’s proposal, and there is broad support for emergency legislation. Senate President Libby Mitchell, D-Vassalboro, said the Legislature will move quickly on the bill once it is received from the governor.

“Unemployment benefits are the safety net for many,” she said. “Until we can create jobs, until the economy turns around, they are dependent on these unemployment benefit checks to feed their families and stay in their homes. The sooner, the better.”

House GOP Leader Josh Tardy, R-Newport, said that while he has been informed of the legislation, he has not seen the actual proposal. He said from what he has been told, he believes lawmakers will endorse the legislation.

“It might be a no-brainer and it may be something we have to do,” he said, “but before we say it’s a no-brainer, we have to do some due diligence.”

Baldacci said he hopes the bill can be acted on by lawmakers this week. He plans further discussions with legislative leaders, and Fortman meets with the Labor Committee today.

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